DCIT, Central Circle-1(1), Hyderabad, Hyderabad V. Sree Educational Society, Hyd, Hyderabad

ITA 581/HYD/2015

• Counselvise Citation: 58122514 RSA 2015
• Duration Of Justice: 6 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2015
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 17-11-2015
• Assessment Year: 2003-2004
• Appeal Filed On: 07-05-2015
• Court: TRIBUNAL
• Department Lawyers: P SOMASEKHAR REDDY
• Keywords: Unexplained cash credit; Depreciation
• Section: 143(3); 12AA; 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B, HYDERABAD BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER I.T.A. NO. 581/HYD/2015 ASSESSMENT YEAR : 2003-04 DEPUTY C OMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1(1), HYDERABAD VS M/S. SREE EDUCATIONAL SOCIETY, HYDERABAD [PAN: AAATS7411B] (APPELLANT) (RESPONDENT) FOR REVENUE : SHRI P. SOMASEKHAR REDDY , CIT - DR FOR ASSESSEE : NONE DATE OF HEARING : 17 - 1 1 - 201 5 DATE OF PRONOUNCEMENT : 27 - 1 1 - 20 15 O R D E R PER B. RAMAKOTAIAH, A.M. : THIS APPEAL BY REVENUE IS AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-XI, HYDERABAD DATED 16-02-2015. REVENUE HAS RAISED THE FOLLOWING GROUN D 2, WHICH IS MATERIAL FOR CONSIDERATION: THE LEARNED CIT(A) OUGHT TO HAVE APPRECIATED THE F ACT THAT THE DGIT (INV.) HAS RESCINDED THE EXEMPTION U/ S. 10(23)(C)(VI) WHICH IS SUBJUDICE. ALSO, THE LEARNE D CIT(A) OUGHT TO HAVE CONSIDERED THE FACT THAT THE DECISION OF HO N'BLE ITAT RESTORING THE REGISTRATION HAS NOT BEEN ACCEPTED BY THE DEPARTMENT AND FURTHER APPEAL TO HON'BLE HIGH COURT OF ANDHRA PRADESH HAS BEEN PREFERRED. THE MATTER IS S UBJUDICE. GROUND NOS. 1 & 3 ARE GENERAL IN NATURE. I.T.A. NO. 581/HYD/2015 M/S. SREE EDUCATIONAL SOCIETY :- 2 -: 2. BRIEFLY STATED, ASSESSEE REGISTERED U/S. 12AA OF THE INCOME TAX ACT [ACT] AND MAINLY RUNNING AN ENGINEERING COL LEGE IN THE NAME OF SREENIDHI INSTITUTE OF ENGINEERING & TECHNO LOGY, HAD FILED ITS RETURN OF INCOME DECLARING LOSS OF RS. 12,74,79 1/-. AN ORDER U/S. 143 DT. 28-03-2006 WAS PASSED DETERMINING THE LOSS AT RS. 3,88,980/-. THEREAFTER, PROCEEDINGS U/S. 147 WERE INITIATED AND IN THE RE-ASSESSMENT PROCEEDINGS ADDITIONS WERE MADE U /S. 143(3) R.W.S. 147. IN THE ORDER AO: I. TREATED RECEIPTS OF RS. 5,13,26,698/- AS INCOME OF THE ASSESSEE; II. DISALLOWED THE CLAIM FOR DEPRECIATION OF RS. 1,15, 57,113/-; III. CONSIDERED BUILDING FUND OF RS. 19,82,209/- AS INC OME; IV. ADDED RS. 42,66,320/- AND RS. 2,54,54,866/- ON ACC OUNT OF EXCESS PAYMENT TO SECRETARY AND UNEXPLAINED CREDITS RESPECTIVELY. 3. AGGRIEVED, IN APPEAL BEFORE CIT(A), ASSESSEE RAI SED PRELIMINARY ISSUE OF JURISDICTION WHICH WAS REJECTE D BY THE LD. CIT(A). WITH REFERENCE TO VARIOUS ADDITIONS MADE, LD. CIT(A) UPHELD THE TREATMENT OF BUILDING FUND AS INCOME A ND DELETED THE OTHER ADJUSTMENTS MADE AND CONTESTED BY ASSESSEE. WHILE ADJUDICATING THE GROUNDS RAISED, LD. CIT(A) OPINED AS FOLLOWS: 06.7 IT MAY BE MENTIONED THAT THE REGISTRATION U/ S. 12AA WAS WITHDRAWN BY THE CIT VIDE HIS ORDER IN F.N O. CIT (CENTRAL)/H/12AA/SES/2011-12, DATED 29.03.2012 AND THAT HAD ALSO BEEN REPORTED TO BE RESTORED. IN VIEW OF THE AFORESAID, THE ASSESSING OFFICER IS DIRECTED TO RE- COMPUTE THE INCOME OF THE ASSESSEE. I.T.A. NO. 581/HYD/2015 M/S. SREE EDUCATIONAL SOCIETY :- 3 -: REVENUE IS AGGRIEVED ON THE ISSUE THAT EXEMPTION U /S. 10(23)(C)(VI) WAS SUBJUDICE AND CIT(A) OUGHT TO HAV E APPRECIATED THE FACT. 4. AFTER HEARING THE LD. DR IN THE ABSENCE OF THE R EPRESENTATION FROM ASSESSEE, WE ARE OF THE OPINION THAT GROUNDS R AISED BY THE REVENUE ARE NOT AT ALL CONNECTED TO THE ISSUE DECID ED BY THE LD. CIT(A). IN FACT AS SEEN FROM THE ORDER, THE ISSUES DECIDED BY THE LD. CIT(A) ARE ON THE JURISDICTION OF INITIATION OF PROCEEDING U/S. 147 WHICH WERE IN FAVOUR OF THE REVENUE AND OUT OF THE FOUR ADDITIONS, THE LD. CIT(A) UPHELD THE ADDITION OF ON E ITEM AND DELETED THE BALANCE. AS CAN BE SEEN FROM THE GROUN DS, THERE IS NO ISSUE ON MERITS AT ALL AND THE PASSING OBSERVATION IN PARA 6.7 AS EXTRACTED ABOVE IS WITH REFERENCE TO REGISTRATION U /S. 12AA AND NOT EXEMPTION U/S. 10(23)(C)(VI). SINCE THE GROUNDS RA ISED HAVE NO CONNECTION TO THE ORDER PASSED BY THE LD. CIT(A), W E HAVE NO OPTION THAN TO DISMISS THE GROUNDS. 5. IN THE RESULT, APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH NOVEMBER, 2015 SD/- SD/- (D. MANMOHAN) (B. RAMAKOTAIAH) VICE PRESIDENT ACCOUNTANT MEMBE R HYDERABAD, DATED 27 TH NOVEMBER, 2015 TNMM I.T.A. NO. 581/HYD/2015 M/S. SREE EDUCATIONAL SOCIETY :- 4 -: COPY TO : 1. DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1 (1), 3 RD FLOOR, POSNETT BHAVAN, TILAK ROAD, RAM KOTI, HYDERABAD. 2. M/S. SREE EDUCATIONAL SOCIETY, 1-2-288/23/1, DOMALGUDA, HYDERABAD. 3. CIT (APPEALS)-XI, HYDERABAD. 4. THE PR. CIT-(CENTRAL), HYDERABAD. 5 . D.R. ITAT, HYDERABAD. 6 . GUARD FILE.